Selected Acquisition Report (SAR) Room/Selected_Acquisition...AWACS is critical to gaining and maintaining battle-space air superiority.€ AWACS coordinates with both tactical and

Selected Acquisition Report (SAR)

RCS: DD-A&T(Q&A)823-277

Airborne Warning and Control System Block 40/45 Upgrade (AWACS Blk 40/45 Upgrade)

As of FY 2017 President's Budget

Defense Acquisition ManagementInformation Retrieval

(DAMIR)

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UNCLASSIFIED

AWACS Blk 40/45 Upgrade December 2015 SAR

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UNCLASSIFIED 2

Table of Contents Common Acronyms and Abbreviations for MDAP Programs 3

Program Information 5

Responsible Office 5

References 5

Mission and Description 6

Executive Summary 7

Threshold Breaches 8

Schedule 9

Performance 10

Track to Budget 12

Cost and Funding 13

Low Rate Initial Production 21

Foreign Military Sales 22

Nuclear Costs 22

Unit Cost 23

Cost Variance 26

Contracts 29

Deliveries and Expenditures 31

Operating and Support Cost 32

Common Acronyms and Abbreviations for MDAP Programs

Acq O&M - Acquisition-Related Operations and MaintenanceACAT - Acquisition CategoryADM - Acquisition Decision MemorandumAPB - Acquisition Program BaselineAPPN - AppropriationAPUC - Average Procurement Unit Cost$B - Billions of DollarsBA - Budget Authority/Budget ActivityBlk - BlockBY - Base YearCAPE - Cost Assessment and Program EvaluationCARD - Cost Analysis Requirements DescriptionCDD - Capability Development DocumentCLIN - Contract Line Item NumberCPD - Capability Production DocumentCY - Calendar YearDAB - Defense Acquisition BoardDAE - Defense Acquisition ExecutiveDAMIR - Defense Acquisition Management Information RetrievalDoD - Department of DefenseDSN - Defense Switched NetworkEMD - Engineering and Manufacturing DevelopmentEVM - Earned Value ManagementFOC - Full Operational CapabilityFMS - Foreign Military SalesFRP - Full Rate ProductionFY - Fiscal YearFYDP - Future Years Defense ProgramICE - Independent Cost EstimateIOC - Initial Operational CapabilityInc - IncrementJROC - Joint Requirements Oversight Council$K - Thousands of DollarsKPP - Key Performance ParameterLRIP - Low Rate Initial Production$M - Millions of DollarsMDA - Milestone Decision AuthorityMDAP - Major Defense Acquisition ProgramMILCON - Military ConstructionN/A - Not ApplicableO&M - Operations and MaintenanceORD - Operational Requirements DocumentOSD - Office of the Secretary of DefenseO&S - Operating and SupportPAUC - Program Acquisition Unit Cost


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UNCLASSIFIED 3

PB - President’s BudgetPE - Program ElementPEO - Program Executive OfficerPM - Program ManagerPOE - Program Office EstimateRDT&E - Research, Development, Test, and EvaluationSAR - Selected Acquisition ReportSCP - Service Cost PositionTBD - To Be DeterminedTY - Then YearUCR - Unit Cost ReportingU.S. - United StatesUSD(AT&L) - Under Secretary of Defense (Acquisition, Technology and Logistics)


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UNCLASSIFIED 4

Mr. Thomas Ramsey3001 Staff Drive, Suite 2AH198CTinker AFB, OK 73145

[email protected]

Phone: 405-736-2370

Fax: 405-736-5412

DSN Phone: 336-2370

DSN Fax: 336-5412

Date Assigned: February 4, 2015

Program Information

Program Name

Airborne Warning and Control System Block 40/45 Upgrade (AWACS Blk 40/45 Upgrade)

DoD Component

Air Force

Responsible Office

References

SAR Baseline (Production Estimate)

Air Force Acquisition Executive (AFAE) Approved Acquisition Program Baseline (APB) dated May 1, 2013

Approved APB

Air Force Acquisition Executive (AFAE) Approved Acquisition Program Baseline (APB) dated October 20, 2015


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UNCLASSIFIED 5

Mission and Description

The Airborne Warning and Control System (AWACS) provides a highly mobile, flexible, survivable theater Battle Management (BM), Wide Area Surveillance, and Command and Control (C2) capability. It is capable of detecting, identifying, and tracking airborne and maritime targets at extended ranges as well as identifying air/ground emitters. AWACS can relay “big picture” information to C2 agencies and friendly aircraft. AWACS provides worldwide response to situations requiring immediate on-scene C2/BM using embedded real-time surveillance for employment of US and allied combat air forces. AWACS is critical to gaining and maintaining battle-space air superiority. AWACS coordinates with both tactical and C2 assets in theater to execute the air mission.

The AWACS Block 40/45 Upgrade program is the largest modification in U.S. AWACS history and represents the critical foundation and baseline system required for all future AWACS enterprise modifications including net-centric operations. The AWACS Block 40/45 Upgrade provides a single target/single track capability with an improved human-machine interface for time-critical targeting designed to increase combat effectiveness and reduce fratricide. The AWACS Block 40/45 Upgrade program includes an upgrade to Electronic Support Measures sensor data processing; Multi-Source Integration; a Data Link Infrastructure with prioritized data link bandwidth management for Link 16/Link 11; new battle management tools; capability to parse, allow user access to, and integrate Air Control Order/Air Tasking Order data; enhanced mission and console recording capabilities; and an update to a low-bandwidth internet chat capability (Secure Iridium Chat).


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UNCLASSIFIED 6

Executive Summary

The AWACS Block 40/45 Upgrade program remains funded for a fleet size of 24. In the FY 2016 PB, the Air Force re-phased the E-3 force reduction of seven aircraft to FY 2019. The AWACS Block 40/45 Upgrade program is already positioned in accordance with the planned FY 2019 divestiture; therefore, the program will continue to execute to a baseline of 24 aircraft.

Since submission of the June 2015 SAR, the program office completed the SCP, signed by the Assistant Secretary of the Air Force for Financial Management and Comptroller (SAF/FM) on July 31, 2015. An APB amendment was signed by the Air Force Acquisition Executive on October 20, 2015.

The AWACS Block 40/45 Upgrade program continues to meet all KPPs. During CY 2015, AWACS Block 40/45 installation and deliveries remained on schedule despite several aircraft having experienced delays due to maintenance issues unrelated to Block 40/45 installation. As of December 31, 2015, ten modified aircraft have been delivered.

In FY 2017, we intend to procure the last Commercial Off The Shelf (COTS) necessary to install 40/45 on four aircraft and refresh the six LRIP aircraft to the final configuration. The FY 2017 PB position/FYDP funding profile does not include funding to purchase COTS for any of the seven aircraft the Air Force intends to retire. If these seven aircraft are subsequently retained and modified, significant Non-Recurring Engineering may be necessary to address any COTS no longer available.

There are no significant software-related issues at this time. However, the program office is engaged with Boeing on how to control the cost of emerging cyber security requirements and the integration of urgent operational needs for internet connectivity into 40/45 hardware/software baseline.


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UNCLASSIFIED 7

APB Breaches

Schedule Performance Cost RDT&E

Procurement MILCON Acq O&M

O&S CostUnit Cost PAUC

APUC

Nunn-McCurdy Breaches

Current UCR Baseline PAUC NoneAPUC None

Original UCR Baseline PAUC NoneAPUC None

Threshold Breaches


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UNCLASSIFIED 8

Schedule

Schedule Events

EventsSAR Baseline

ProductionEstimate

Current APBProduction

Objective/Threshold

CurrentEstimate

Milestone B - System Development and Demonstration Jul 2003 Jul 2003 Jul 2003 Jul 2003

Milestone C - Low-Rate Initial Production Jan 2009 Jan 2009 Jan 2009 Jan 2009

Initial Operational Test and Evaluation Complete (IOT&E) Jun 2012 Jun 2012 Jun 2012 Jun 2012

Full Rate Production Decision Dec 2012 Dec 2012 Dec 2012 Dec 2012

IOC RAA Apr 2014 Jan 2014 Jan 2014 Jan 2014

FOC RAA Aug 2020 Aug 2020 Feb 2021 Aug 2020

Change Explanations

None

Notes

Current estimate dates are based on FY 2017 PB and 24 aircraft fleet size. IOC RAA was declared by the PM on January 7, 2014 and Air Combat Command declared IOC on July 28, 2014.

Acronyms and Abbreviations

FOC RAA - Full Operational Capability - Required Assets AvailableIOC RAA - Initial Operational Capability - Required Assets Available


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Performance

Performance Characteristics

SAR BaselineProductionEstimate


Objective/Threshold

DemonstratedPerformance

CurrentEstimate

Multi-Source Integration

(Objective = Threshold) All target data shall be correlated, fused, and integrated into a single track

(Objective = Threshold) All target data shall be correlated, fused, and integrated into a single track

All target data shall be correlated, fused, and integrated into a single track

The Beyond LRIP report confirms the system meets required threshold performance.

The Beyond LRIP report confirms the system meets required threshold performance.

Net Ready

System must fully support execution of all activities identified in joint and system integrated architectures. 1) DISR mandated GIG IT standards and profiles identified in the TV-1. 2) DISR mandated GIG KIPs identified in the KIP declaration table. 3) Net-Centric Operations and Warfare Reference Model Enterprise Services. 4) IA requirements and issuance of an ATO by the DAA. 5) Operationally-effective information exchanges and mission critical performance specified in the applicable joint and system integrated architecture views.

System must fully support execution of all activities identified in joint and system integrated architectures. 1) DISR mandated GIG IT standards and profiles identified in the TV-1. 2) DISR mandated GIG KIPs identified in the KIP declaration table. 3) Net-Centric Operations and Warfare Reference Model Enterprise Services. 4) IA requirements and issuance of an ATO by the DAA. 5) Operationally-effective information exchanges and mission critical performance specified in the applicable joint and system integrated architecture views.

System must fully support execution of joint critical activities identified in joint and system integrated architectures. System must satisfy the technical requirements for future transition to Net-Centric operations to include: 1) DISR mandated GIG IT standards and profiles identified in the TV-1; 2) DISR mandated GIG KIPs identified in the KIP declaration table; 3) Net-Centric Operations and Warfare Reference Model Enterprise Services; 4) IA requirements and issuance of an IATO by the DAA; 5) Operationally-effective information exchanges and mission critical performance specified in the applicable joint and system integrated architecture views.

Per Joint Interoperability Test Command letter dated October 25, 2012, "The AWACS Block 40/45 Upgrade, V10.1.20i meets the joint critical interoperability requirements in the Joint Staff-certified AWACS Block 40/45 Upgrade Program ISP, 17 October 2011". Air Force C2 Platform Information Technology DAA issued an IATO on January 11, 2012. Subsequent lATOs and ATOs have been introduced for each software version afterwards.

Each version/release of Block 40/45 continues to be approved for use by an IATO or ATO.

Classified Performance information is provided in the classified annex to this submission.


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UNCLASSIFIED 10

Requirements Reference

ORD (Combat Air Forces 010-02-I/II) dated June 16, 2009 (in lieu of CPD)

Change Explanations

None

Acronyms and Abbreviations

AEW&C - Airborne Early Warning and ControlATO - Approval to OperateDAA - Designated Approving AuthorityDISR - Department of Defense Information Technology Standards RegistryDOT&E - Director of Operational Test & EvaluationGIG - Global Information GridIA - Information AssuranceIATO - Interim Approval to OperateISP - Information Support PlanIT - Information TechnologyKIP - Key Interface ProfileTV-1 - Technical View 1


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Track to Budget

RDT&E

Appn BA PE

Air Force 3600 07 0207417F Project Name

67411L AWACS (Shared)

Procurement

Appn BA PE

Air Force 3010 06 0207417F Line Item Name

000999 Initial Spares (Shared) Air Force 3010 05 0207417F

Line Item Name

E00300 E-3 (Shared) E34045 Airborne Warning and Control Systems Notes

The Procurement funding for the AWACS Block 40/45 Upgrade program is located in modification number 50001T.

Funding for this modification is located in two P-1 Line Item Numbers. AWACS Block 40/45 funding had previously been contained in Weapon System Code (WSC) E00300, but as part of the Major Programs Transparency Initiative and starting in FY 2015, the AWACS Block 40/45 Upgrade was moved to WSC E34045. Prior year funding remains in WSC E00300.


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UNCLASSIFIED 12

Cost and Funding

Cost Summary

Total Acquisition Cost

Appropriation

BY 2012 $M BY 2012 $M TY $M



Objective/Threshold

CurrentEstimate


Current APBProductionObjective

CurrentEstimate

RDT&E 1319.0 1272.6 1415.8 1273.2 1192.2 1145.9 1145.9Procurement 1503.4 1389.8 1527.4 1382.0 1615.4 1496.5 1479.0

Flyaway -- -- -- 1344.8 -- -- 1439.0Recurring -- -- -- 934.7 -- -- 997.3Non Recurring -- -- -- 410.1 -- -- 441.7

Support -- -- -- 37.2 -- -- 40.0Other Support -- -- -- 0.0 -- -- 0.0Initial Spares -- -- -- 37.2 -- -- 40.0

MILCON 0.0 0.0 0.0 0.0 0.0 0.0 0.0Acq O&M 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Total 2822.4 2662.4 N/A 2655.2 2807.6 2642.4 2624.9

Current APB Cost Estimate Reference

AWACS Block 40/45 FRP SCP Update dated July 28, 2015

Confidence Level

Confidence Level of cost estimate for current APB: 53%

The Life-Cycle Cost Estimate (LCCE) confidence level of 53% reflects the expected value, or mean, of the cost estimate distribution. It takes into consideration relevant risks, including ordinary levels of external and unforeseen events, aiming to provide sufficient resources to execute the program under normal conditions encountering average levels of technical, schedule, and programmatic risk and external influence.


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Total Quantity

QuantitySAR Baseline

ProductionEstimate


Current Estimate

RDT&E 0 0 0Procurement 31 24 24

Total 31 24 24

Quantity Notes

Throughout the Cost and Funding section, the quantity of 24 reflects kit procurement and not kit installations. To date, the program has procured and delivered 16 kits, 10 of which have been installed on aircraft.


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UNCLASSIFIED 14

Cost and Funding

Funding Summary

Appropriation Summary

FY 2017 President's Budget / December 2015 SAR (TY$ M)

Appropriation Prior FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021To

CompleteTotal

RDT&E 1145.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1145.9Procurement 866.9 183.6 227.9 106.6 61.4 32.6 0.0 0.0 1479.0MILCON 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Acq O&M 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

PB 2017 Total 2012.8 183.6 227.9 106.6 61.4 32.6 0.0 0.0 2624.9PB 2016 Total 2018.3 188.8 230.9 106.8 61.5 47.8 0.0 0.0 2654.1

Delta -5.5 -5.2 -3.0 -0.2 -0.1 -15.2 0.0 0.0 -29.2

Quantity Summary

FY 2017 President's Budget / December 2015 SAR (TY$ M)

Quantity Undistributed PriorFY

2016FY

2017FY

2018FY

2019FY

2020FY

2021To

CompleteTotal

Development 0 0 0 0 0 0 0 0 0 0Production 0 18 2 4 0 0 0 0 0 24

PB 2017 Total 0 18 2 4 0 0 0 0 0 24PB 2016 Total 0 18 2 4 0 0 0 0 0 24

Delta 0 0 0 0 0 0 0 0 0 0


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UNCLASSIFIED 15

Cost and Funding

Annual Funding By Appropriation

Annual Funding3600 | RDT&E | Research, Development, Test, and Evaluation, Air Force

FiscalYear

Quantity

TY $M

End ItemRecurring

Flyaway

Non EndItem

RecurringFlyaway

NonRecurring

Flyaway

TotalFlyaway

TotalSupport

TotalProgram

1999 -- -- -- -- -- -- 0.92000 -- -- -- -- -- -- 14.22001 -- -- -- -- -- -- 10.12002 -- -- -- -- -- -- 17.82003 -- -- -- -- -- -- 116.02004 -- -- -- -- -- -- 193.02005 -- -- -- -- -- -- 243.72006 -- -- -- -- -- -- 106.32007 -- -- -- -- -- -- 127.92008 -- -- -- -- -- -- 90.72009 -- -- -- -- -- -- 69.92010 -- -- -- -- -- -- 50.12011 -- -- -- -- -- -- 85.12012 -- -- -- -- -- -- 5.82013 -- -- -- -- -- -- 3.12014 -- -- -- -- -- -- 11.3

Subtotal -- -- -- -- -- -- 1145.9


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UNCLASSIFIED 16

Annual Funding3600 | RDT&E | Research, Development, Test, and Evaluation, Air Force

FiscalYear

Quantity

BY 2012 $M

End ItemRecurring

Flyaway

Non EndItem

RecurringFlyaway

NonRecurring

Flyaway

TotalFlyaway

TotalSupport

TotalProgram

1999 -- -- -- -- -- -- 1.12000 -- -- -- -- -- -- 17.62001 -- -- -- -- -- -- 12.42002 -- -- -- -- -- -- 21.62003 -- -- -- -- -- -- 138.72004 -- -- -- -- -- -- 225.02005 -- -- -- -- -- -- 276.92006 -- -- -- -- -- -- 117.32007 -- -- -- -- -- -- 137.52008 -- -- -- -- -- -- 95.62009 -- -- -- -- -- -- 72.72010 -- -- -- -- -- -- 51.42011 -- -- -- -- -- -- 85.82012 -- -- -- -- -- -- 5.72013 -- -- -- -- -- -- 3.02014 -- -- -- -- -- -- 10.9

Subtotal -- -- -- -- -- -- 1273.2


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Annual Funding3010 | Procurement | Aircraft Procurement, Air Force

FiscalYear

Quantity

TY $M

End ItemRecurring

Flyaway

Non EndItem

RecurringFlyaway

NonRecurring

Flyaway

TotalFlyaway

TotalSupport

TotalProgram

2008 -- -- 0.2 2.4 2.6 -- 2.62009 1 32.5 15.3 13.4 61.2 2.9 64.12010 2 45.7 6.5 12.1 64.3 0.5 64.82011 3 113.0 20.7 28.8 162.5 2.8 165.32012 5 106.8 7.7 3.8 118.3 3.6 121.92013 -- -- 66.0 71.4 137.4 5.4 142.82014 2 60.7 6.0 42.1 108.8 2.3 111.12015 5 100.2 38.5 52.6 191.3 3.0 194.32016 2 64.7 7.5 106.1 178.3 5.3 183.62017 4 114.4 58.3 50.7 223.4 4.5 227.92018 -- 59.3 6.6 37.5 103.4 3.2 106.62019 -- 31.4 6.2 20.6 58.2 3.2 61.42020 -- 23.5 5.6 0.2 29.3 3.3 32.6

Subtotal 24 752.2 245.1 441.7 1439.0 40.0 1479.0


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Annual Funding3010 | Procurement | Aircraft Procurement, Air Force

FiscalYear

Quantity

BY 2012 $M

End ItemRecurring

Flyaway

Non EndItem

RecurringFlyaway

NonRecurring

Flyaway

TotalFlyaway

TotalSupport

TotalProgram

2008 -- -- 0.2 2.5 2.7 -- 2.72009 1 33.3 15.6 13.7 62.6 3.0 65.62010 2 45.9 6.5 12.2 64.6 0.5 65.12011 3 111.7 20.5 28.4 160.6 2.8 163.42012 5 104.0 7.5 3.7 115.2 3.5 118.72013 -- -- 63.0 68.1 131.1 5.2 136.32014 2 57.1 5.6 39.7 102.4 2.2 104.62015 5 93.1 35.8 48.8 177.7 2.8 180.52016 2 59.0 6.8 96.8 162.6 4.8 167.42017 4 102.3 52.2 45.4 199.9 4.0 203.92018 -- 52.0 5.8 32.9 90.7 2.8 93.52019 -- 27.0 5.3 17.7 50.0 2.8 52.82020 -- 19.8 4.7 0.2 24.7 2.8 27.5

Subtotal 24 705.2 229.5 410.1 1344.8 37.2 1382.0


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Cost Quantity Information3010 | Procurement | Aircraft Procurement, Air Force

FiscalYear

Quantity

End ItemRecurring

Flyaway(Aligned With

Quantity)BY 2012 $M

2008 -- --2009 1 33.32010 2 45.92011 3 111.42012 5 103.02013 -- --2014 2 62.42015 5 110.02016 2 103.32017 4 135.92018 -- --2019 -- --2020 -- --

Subtotal 24 705.2


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UNCLASSIFIED 20

Low Rate Initial Production

Item Initial LRIP Decision Current Total LRIP

Approval Date 11/24/2008 11/24/2008

Approved Quantity 6 6

Reference Milestone C ADM Milestone C ADM

Start Year 2009 2009

End Year 2014 2015

The Current Total LRIP Quantity is more than 10% of the total production quantity due to operational requirements.

Air Combat Command identified a requirement for five AWACS Block 40/45 Upgrade aircraft for IOC declaration. The program office requested an LRIP quantity of six to utilize the first modified aircraft as a risk reduction asset to streamline the process of combining a major upgrade with Programmed Depot Maintenance. In addition, the first aircraft was required to support production qualification testing.

The Start Year indicated specifies the year that the LRIP contract (Delivery Order 23) was awarded. The program procured one 40/45 shipset in FY 2009, two 40/45 shipsets in FY 2010 and three 40/45 shipsets in FY 2011. The Current End Year indicated above specifies the completion of the contract Period of Performance (PoP).

The PoP was extended to July 2015 to complete the provisioning effort.


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Foreign Military Sales

None

Nuclear Costs

None


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UNCLASSIFIED 22

Unit Cost

Unit Cost Report

Item

BY 2012 $M BY 2012 $M

% ChangeCurrent UCRBaseline

(Oct 2015 APB)

Current Estimate(Dec 2015 SAR)

Program Acquisition Unit CostCost 2662.4 2655.2 Quantity 24 24 Unit Cost 110.933 110.633 -0.27

Average Procurement Unit CostCost 1389.8 1382.0 Quantity 24 24 Unit Cost 57.908 57.583 -0.56

Item

BY 2012 $M BY 2012 $M

% ChangeOriginal UCRBaseline

(May 2013 APB)

Current Estimate(Dec 2015 SAR)

Program Acquisition Unit Cost Cost 2822.4 2655.2 Quantity 31 24 Unit Cost 91.045 110.633 +21.51

Average Procurement Unit CostCost 1503.4 1382.0 Quantity 31 24 Unit Cost 48.497 57.583 +18.74

.


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Unit Cost History

Item DateBY 2012 $M TY $M

PAUC APUC PAUC APUC

Original APB May 2013 91.045 48.497 90.568 52.110APB as of January 2006 N/A N/A N/A N/A N/ARevised Original APB N/A N/A N/A N/A N/APrior APB May 2013 91.045 48.497 90.568 52.110Current APB Oct 2015 110.933 57.908 110.100 62.354Prior Annual SAR Dec 2014 111.383 57.821 110.588 62.217Current Estimate Dec 2015 110.633 57.583 109.371 61.625

SAR Unit Cost History

Current SAR Baseline to Current Estimate (TY $M)

Initial PAUCProductionEstimate

Changes PAUCCurrentEstimateEcon Qty Sch Eng Est Oth Spt Total

90.568 -0.308 15.623 -0.912 0.000 4.562 0.000 -0.162 18.803 109.371

Current SAR Baseline to Current Estimate (TY $M)

Initial APUCProductionEstimate

Changes APUCCurrentEstimate Econ Qty Sch Eng Est Oth Spt Total

52.110 -0.317 4.407 -0.217 0.000 5.804 0.000 -0.162 9.515 61.625


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SAR Baseline History

ItemSAR

PlanningEstimate

SARDevelopment

Estimate

SARProduction

Estimate

CurrentEstimate

Milestone A N/A N/A N/A N/AMilestone B N/A N/A Jul 2003 Jul 2003Milestone C N/A N/A Jan 2009 Jan 2009IOC N/A N/A Apr 2014 Jan 2014Total Cost (TY $M) N/A N/A 2807.6 2624.9Total Quantity N/A N/A 31 24PAUC N/A N/A 90.568 109.371


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Cost Variance

Summary TY $M

Item RDT&E Procurement MILCON Total


1192.2 1615.4 -- 2807.6

Previous ChangesEconomic +0.9 +0.5 -- +1.4Quantity -- -259.0 -- -259.0Schedule -16.7 -5.2 -- -21.9Engineering -- -- -- --Estimating -15.5 +145.3 -- +129.8Other -- -- -- --Support -- -3.8 -- -3.8

Subtotal -31.3 -122.2 -- -153.5Current Changes

Economic -0.7 -8.1 -- -8.8Quantity -- -- -- --Schedule -- -- -- --Engineering -- -- -- --Estimating -14.3 -6.0 -- -20.3Other -- -- -- --Support -- -0.1 -- -0.1

Subtotal -15.0 -14.2 -- -29.2Adjustments -- -- -- --Total Changes -46.3 -136.4 -- -182.7

CE - Cost Variance 1145.9 1479.0 -- 2624.9CE - Cost & Funding 1145.9 1479.0 -- 2624.9


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UNCLASSIFIED 26

Summary BY 2012 $M

Item RDT&E Procurement MILCON Total


1319.0 1503.4 -- 2822.4

Previous ChangesEconomic -- -- -- --Quantity -- -227.1 -- -227.1Schedule -17.9 -6.4 -- -24.3Engineering -- -- -- --Estimating -15.6 +122.2 -- +106.6Other -- -- -- --Support -- -4.4 -- -4.4

Subtotal -33.5 -115.7 -- -149.2Current Changes

Economic -- -- -- --Quantity -- -- -- --Schedule -- -- -- --Engineering -- -- -- --Estimating -12.3 -5.7 -- -18.0Other -- -- -- --Support -- -- -- --

Subtotal -12.3 -5.7 -- -18.0Adjustments -- -- -- --Total Changes -45.8 -121.4 -- -167.2

CE - Cost Variance 1273.2 1382.0 -- 2655.2CE - Cost & Funding 1273.2 1382.0 -- 2655.2

Previous Estimate: June 2015


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UNCLASSIFIED 27

RDT&E $M

Current Change ExplanationsBase Year

Then Year

Revised escalation indices. (Economic) N/A -0.7Adjustment for current and prior escalation. (Estimating) +0.6 +0.6Realignment of funds from AWACS Blk 40/45 to support Combat Identification program.

(Estimating)-12.9 -14.9

RDT&E Subtotal -12.3 -15.0

Procurement $M

Current Change ExplanationsBase Year

Then Year

Revised escalation indices. (Economic) N/A -8.1Adjustment for current and prior escalation. (Estimating) +4.1 +4.2Realignment of funding from AWACS Blk 40/45 to source the Next-Generation Identification

Friend or Foe and Training Support Infrastructure requirements. (Estimating)-9.8 -10.2

Adjustment for current and prior escalation. (Support) +0.1 +0.2Decrease in Initial Spares. (Support) -0.1 -0.3

Procurement Subtotal -5.7 -14.2


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UNCLASSIFIED 28

Contracts

Contract Identification

Appropriation: Procurement

Contract Name: AWACS 40/45 Upgrade Program Full Rate Production

Contractor: The Boeing Company

Contractor Location: P.O. Box 3707Seattle, WA 98124-2207

Contract Number: F19628-01-D-0016/26

Contract Type: Fixed Price Incentive(Firm Target) (FPIF)

Award Date: December 27, 2012

Definitization Date: December 27, 2012

Contract Price

Initial Contract Price ($M) Current Contract Price ($M) Estimated Price At Completion ($M)

Target Ceiling Qty Target Ceiling Qty Contractor Program Manager

137.3 142.5 N/A 205.3 249.1 N/A 182.1 175.7

Target Price Change Explanation

The difference between the Initial Contract Price Target and the Current Contract Price Target is due to the award of Next Generation Identification Friend or Foe Integration and FRP Shipsets #12 and 13.

Contract Variance

Item Cost Variance Schedule Variance

Cumulative Variances To Date (1/28/2016) +10.8 -3.2 Previous Cumulative Variances +1.7 -7.7 Net Change +9.1 +4.5

Cost and Schedule Variance Explanations

The favorable net change in the cost variance is due to improvements in cost performance of CLINs 3606, 3610, and 3613. The government-contractor team has been effective in controlling Shipset costs over the period July 2015 to December 2015.

The favorable net change in the schedule variance is due to strong recovery in the schedule variances for CLINs 3606 and 3613, over the period July 2015 to January 2016.


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UNCLASSIFIED 29

Notes

Earned Value Management Data is received only for specific CLINs listed below representing $178.2M, 61% of the total contract value.

CLIN 3300 Engineering Support to Diminishing Manufacturing Sources UpgradeCLIN 3606 FRP #1 Shipsets for aircraft P7 - P11 CLIN 3608 Life of Type Buy CLIN 3613 FRP Shipsets # P12 and P13CLIN 3302 Next Generation Identification Friend or Foe IntegrationCLIN 3610 FRP Shipsets for aircraft P14 - P18


March 23, 2016 16:04:37

UNCLASSIFIED 30

2624.91523.7

58.05%22

Total Acquisition CostExpended to DatePercent ExpendedTotal Funding Years

1881.82%2196.4

83.68%

Years AppropriatedPercent Years AppropriatedAppropriated to DatePercent Appropriated

Deliveries and Expenditures

Deliveries

Delivered to Date Planned to Date Actual to Date Total QuantityPercent

Delivered

Development 0 0 0 --Production 10 10 24 41.67%Total Program Quantity Delivered 10 10 24 41.67%

Expended and Appropriated (TY $M)

The above data is current as of February 09, 2016.


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Operating and Support Cost

Cost Estimate Details

Date of Estimate: July 31, 2015Source of Estimate: SCPQuantity to Sustain: 24Unit of Measure: AircraftService Life per Unit: 25.00 YearsFiscal Years in Service: FY 2011 - FY 2035

O&S cost estimate reflects revised SCP dated July 31, 2015.

Sustainment Strategy

- Production will leave the AWACS fleet with two COTS Diminishing Manufacturing Sources (DMS) versions (DMS 3.0 and DMS 4.0) going into the O&S phase - DMS tech refresh every 5 years starting in FY 2019 through life of program- O&S COTS procured with AF O&M funding- O&S COTS installed by Air Logistics Complex (ALC) during Programmed Depot Maintenance or a dedicated modification installation line- Software maintained organically with contractor support/partnership- COTS, active DMS and DMS refreshes done with contractor partnership- No modifications or capability upgrades included other than planned DMS tech refresh- Product Support Business Case Analysis (PSBCA) initiated in November 2015

Antecedent Information

AWACS Block 30/35 O&S cost is based on historical Block 30/35 O&S cost projected through FY 2035. These costs are used for comparison to Block 40/45 O&S costs. This comparison assumes Block 30/35 can be maintained through FY 2035 and assumes no major DMS issues (Status Quo). Block 30/35 cost was obtained from the Air Force Total Ownership Cost (AFTOC) database for a period of FY 2007-2011. The data was normalized to BY2012 and projected out through FY 2035.


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Annual O&S Costs BY2012 $M

Cost ElementAWACS Blk 40/45 Upgrade

Average Annual Cost Per AircraftAWACS Blk 30/35 (Antecedent)

Average Annual Cost Per Aircraft

Unit-Level Manpower 0.000 11.733Unit Operations 0.000 6.162Maintenance 0.520 8.318Sustaining Support 0.299 1.203Continuing System Improvements 0.098 0.737Indirect Support 0.000 3.583Other 0.000 0.000Total 0.917 31.736

AWACS Block 40/45 Upgrade program Yearly Average per Aircraft costs represent the additional funding required per aircraft when compared to the antecedent AWACS Block 30/35 yearly average per Aircraft O&S costs. Thus, these costs are due solely to the AWACS Block 40/45 Upgrade.

Item

Total O&S Cost $M

AWACS Blk 40/45 UpgradeAWACS Blk 30/35

(Antecedent)Current Production APBObjective/Threshold

Current Estimate

Base Year 550.0 605.0 550.0 19041.1

Then Year 731.3 N/A 731.0 N/A

The AWACS Block 40/45 Upgrade program Current Estimate is the delta cost from the AWACS Block 30/35 (Antecedent) Current Estimate, reflecting the total O&S cost of the AWACS Enterprise.

Equation to Translate Annual Cost to Total Cost

Average annual cost per AWACS aircraft (24) (entire fleet) is calculated by taking the total AWACS 40/45 system cost ($550.0M) and dividing by the life of the platform (FY 2011-2035, 25 years) and then dividing by the total quantity of aircraft (24). $550.0M / 25 / 24 = $0.917M.

O&S Cost Variance

Category BY 2012

$MChange Explanations

Prior SAR Total O&S Estimates - Jun 2015 SAR

1020.8

Programmatic/Planning Factors 0.0Cost Estimating Methodology -470.8 Cost model revised and new basis from AFTOC updated

from 2012 to 2015 dataCost Data Update 0.0Labor Rate 0.0Energy Rate 0.0Technical Input 0.0


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Other 0.0Total Changes -470.8Current Estimate 550.0

Disposal Estimate Details

Date of Estimate: Source of Estimate: Disposal/Demilitarization Total Cost (BY 2012 $M):

There are no disposal costs associated specifically with the AWACS Block 40/45 Upgrade.


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Documents

Selected Acquisition Report (SAR) Room/Selected_Acquisition...AWACS is critical to gaining and maintaining battle-space air superiority.€ AWACS coordinates with both tactical and